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12 years of Cooperation between PETRONET, India and ELENGY,

France From training to cooperation

Authors Rajender SINGH, Director (Technical) Petronet LNG Limited, India

Alain GOY Head of technical department Elengy, GDFSUEZ, France

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Table of Contents

Background and review of initial co-operattion actions ..... Error! Bookmark not defined.1

Towards long-term co-operation ....................................................................................... 9

Engineering reviews for the Kochi contracts ................... Error! Bookmark not defined.15

Towards co-operation with new arrivals .......................... Error! Bookmark not defined.16

A collaboration of equals ................................................ Error! Bookmark not defined.19

Opportunities for co-operation in different matters and conclusion ... 2Error! Bookmark not

defined.1

Background and review of initial co-operation actions

During late 1990s decision was taken by Indian Government that for meeting the energy

need of the country, increasing the share of gas and energy security of India there is need to

import LNG. For this reason in 1997 it was decided to create a special purpose company

(i.e. Petronet LNG Limited), which was mandated to create LNG storage and regasification

facilities in India.

It was decided by this company to select the LNG supplier through global tender route and

based on the above process RasGas, Qatar was selected as long-term supplier of LNG.

Initially till the company formally came into existence the activities were executed by a

dedicated team from GAIL India, thereafter the company (Petronet LNG Limited) was

formally incorporated on 2nd April 1998 with GAIL, INDIA, BPCL, IOCL & ONGC being the

promoters with 12.5% equity each making a total of 50%. Remaining 50% equity was

decided to be kept with Private sector.

Since at that time there was no LNG expertise available within India it was thought prudent

to select a strategic partner having expertise in LNG field. Therefore through a detailed

process in 1997 (i.e. even prior to formal creation of Petronet LNG Limited) GDF was

selected as a strategic partner, which later became equity partner also.

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Background of Gaz de France (GDF)

Since 1965, GDF was operating LNG terminals with success (total availability of its 3 LNG

terminals in Le Havre, Fos Tonkin and Montoir de Bretagne, zero personnel or materiel

accident in operation, zero damage to third parties or impact on neighboring). GDF was a

pioneer in Europe, with the involvement in the first ever commercial LNG chain between

Arzew, Algeria and first ever LNG terminals in Europe (Canvey Island, UK, and Le Havre,

France)

Le Havre, 1965

Fos Tonkin 1972

Montoir de Bretagne, 1980

At that time, GDF is also internationally known for the research and development on LNG

process (ageing, mixing in tank, liquefaction, safety simulations) and GDF does its own

engineering for LNG activities.

And GDF is also a long term buyer of LNG and a reliable partner, able to sign long term gas

purchase agreements under “take or pay” clauses

At that time, GDF decided to extend its activity to international market, and particularly in the

infrastructure design and asset management based on its historical roots, LNG being one of

them.

In 2008, GDF became GDFSUEZ, and import terminals were dedicated to its 100%

subsidiary, ELENGY, and we will see that links were not affected by these changes.

Gaz de France (now ELENGY/GDFSUEZ) as strategic partner assisted PLL in

conceptualization, design, construction and commissioning of India’s first LNG terminal at

Dahej, state of Gujarat.

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PLL, as explained above, is promoted by four Indian Public Service Companies, with vast

experience in designing and operating Oil & Gas installations. GDF supplemented PLL with

the additional skills in cryogenics and LNG, with some specific features which are usually not

available with a consultant.

GDF remained with PLL for all steps of the project including pre-project phase of site

selection, concept of the facility, interaction with various authorities for preliminary and final

approvals. After detailed reviews sites of Dahej in Gujarat and Kochi in Kerala were

selected.

The First French engineer expatriate in Delhi under long term contract in PETRONET

premises brought to the Indian project team its previous experience of operation manager in

Montoir LNG terminal, and ,of course, the full back office of GDF.

Time was dedicated to the site selection and the basis of design of the future facility.

FEED was performed by Sofregaz, subsidiary of GDF at this time. PLL team in this regard

was led by its First Director (Technical).

The Second expatriate, brought its commercial expertise and contributed to assist PLL in:

the long term procurement of LNG from Qatar, under an FOB( free on board basis) the use of certain access channels to the Gulf of Khambat the setting up and contractual aspects of the international tender for the chartering of

two new-built LNG Carriers

the Project Financing of the Dahej construction project

It is time to point out the similarities between LNG chain from Bethioua (Algeria) to Montoir

(France) and the chain between Ras Lafan (Qatar) and Dahej (India)

Same distance

Similar conditions of shipping

Similar size for 2 vessels

Similar trading conditions (free on board)

In that respect, it was relatively simple to transfer the right procedures, order of magnitude or

conditions, from an experienced LNG European company to a new comer, the first Indian

importer of LNG; the transfer of references, this open and permanent benchmark, was a

permanent advantage for PLL in the progression of its pioneering enterprise.

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In 1999, with the end of the FEED studies, the next step was ready i.e. the call for tenders.

A Third expatriate, with both experience in LNG operations, and engineering management

joined the flag.

He was instrumental for the preparation of the first Technical Services Agreement, dedicated

to the preparation of the EPC contract for the Dahej terminal.

He headed a team of French engineers along with the Indian engineers which was in charge

of:

The writing of the tender

The pre qualification of possible contractors

The call for tender

The clarification with the bidders

Every clarification was produced by the team and validated by the Project leader.

After a fair competition and transparent process, the Japanese consortium led by M/s IHI

was awarded the EPC contract on 28th December, 2000.

PLL desired to keep ELENGY as Owner’s partner and maintain the independent status of

PMC. Therefore again following a transparent process FOSTER WHEELER, UK was

selected as PMC, sharing activities with a dedicated team from ONGC.

It was also keeping in view financial involvement of GDF

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June 2001 the shareholder agreement was signed

Time of EPC contract

GDF members were assigned to work as owner’s representative in order to validate the

detailed engineering. Some specific instances in which inputs from experts of GDF were

critical are:

Air recirculation and plume simulation around the air heaters, first regasification of this type in the world

LNG Berth detail design, including berthing and mooring dolphins, due to local weather conditions and stress by the ship on the structure, and the final design of the ship hull in view of fenders position.

Breakwater re-design due to the shore configuration and soil conditions

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Finally the construction of the terminal was completed within cost and schedule in December

2003 and the terminal was put into service in early 2004.First Cargo arrived at Dahej on 30th

Jan 2004.

During construction period, GDF representatives focussed on the commissioning

preparation, on technical side and on organisation (advice of comparison between several

options for operation assignment such as: operation by PLL itself, as a company, or by

GAIL, one of the 4 parents companies, or somebody else, external)

Finally, the first option was selected.

Then GDF provided to PLL the job description of the staff of the terminal, with skills

questionnaire and criteria of selection in view of the recruitment.

In parallel, GDF brought his experience on LNG tankers. GDF representatives worked with

PLL on ships specifications, writing the call for tender, evaluation of bids, technical

evaluation (with French experts from GAZOCEAN, subsidiary of GDF).

And in addition, GDF contributed to the preparation of the long term time chart agreement

with ship owners.

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Once again, we should notice a similarity between Montoir, with silty Loire river, and Dahej,

with even more silty Cambay gulf water.

In Montoir, GDF experienced from 1980 the accumulation of mud in the ballast of the 2 LNG

tankers coming regularly under the long term contract. For that reason, GDF made several

experiments of flushing systems to avoid an excessive weight of mud and to clean the

ballasts during laden voyage. This expertise was of course totally transferred to PLL in the

specifications of its new built LNG tankers.

The order for 2 ships was awarded in 2002

The “Disha” was delivered on 10th January, 2004 and the first LNG cargo was delivered in

Dahej on 30th January, 2004.

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Towards long-term co-operation

After this first TSA dedicated to the EPC phase, GDF was asked by PLL to prepare a second

TSA, dedicated to the operation.

The same was signed on 1st October 2003.

The purposes of this TSA were:

Preparation of the operating and maintenance policy

Theoretical and practical training of PLL operators, in India and in France

Technical assistance during commissioning and writing of safety procedures

Full time technical assistance during the first year in operation

Thus, Elengy contributed to the construction and commissioning phases for the terminal, by

providing a range of services such as:

- training of the PLL personnel to operate the new terminal, with class room training, followed by practical training in Elengy two French terminals, at Fos Tonkin and at Montoir in Bretagne,

- Posting of engineers at Dahej to assist PLL during the critical and intensive commissioning phase, and then for taking ownership of the new plant. This was done

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in 2 phases : first the writing of operation and maintenance procedures, including the emergency safety plan, and second by a permanent presence on site.

- after the commissioning, training of the maintenance managers in France in 2005, in rare and specific maintenance tasks, including practical disassembly and inspection of equipment

Training of the PLL Dahej terminal staff

Theoretical in Delhi

Then, practical in France

This training gave the opportunity to check the involvement of the staff and the high

educational level of these people.

The most difficult aspect was to accept the French food during these periods in France!

In control room

In workshop

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The fire fighting training gave to each person the opportunity to see real LNG when the pool

is prepared, to see the plume of flammable vapours above the pool and to feel the heat of

the large flames during the fire fighting itself, in a very safe manner.

For that reason, this training was continued every year since 2004, with the objective to train

each new comer in PLL.

Commissioning

Although PLL team had personal with varied experience in commissioning of hydrocarbon

facility (most of PLL team members came with prior experience of Fertilizer sector), yet

experience of LNG was missing. GDF team supplemented the same, and that resulted into

smooth commissioning of Dahej terminal

Four people from GDF remained in Dahej during commissioning, 4 shift managers from GDF

terminals teams directly included in the Dahej shift teams for one year.

The commissioning was a success, due to the quality of the works by the contractor, the

involvement of the personnel of PLL and the good preparation of this critical phase.

No leak, no accident, no loss

30th January, 2004 : first call of the ship

8th February, 2004 successful cooling down of the tanks

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Marine operation

Once again, in a spirit of total confidence, PLL asked GDF to perform an audit of the DISHA

LNG tanker (vetting) and an audit of the fitness of the berth

The mission occurred this time in order to benefit from the long stay of the LNG Tanker “SS

Disha” alongside and the commissioning operation of the plant and gives inputs useful for

the future regular operation of the PETRONET LNG LIMITED (PLL) Terminal.

This audit was led by a marine surveyor after being Master of LNGC Carrier for 14 years and

the GDF senior LNG expert in the area of shipping and ship / shore interface having

previously participated in the shipping evaluation of the project at end of 2000 and beginning

of 2001, in the FEED phase.

PLL can thus have confidence in GDF as its people are aware of the features of the project,

by previous involvement, and GDF involvement not only as reputed consultants, but also as

share holders.

At Dahej port, there are very specific requirements to be met when unloading an LNG

tanker, especially during monsoon conditions, which ultimately depend on the local weather

conditions: safely unloading a gas tanker in monsoon conditions, particularly tankers arriving

for the first time, was the focus of a real transfer of knowledge between Elengy and the

Dahej port officer. This work gave operating limits for the berth (time of arrival according to

the tide, conditions of berthing according to monsoon winds, mooring specific features with

long lines, control of the ship during level variations with the tide, …)

These operating limits gave successful results.

PLL asked GDF to perform audit dedicated to this marine interface in 2007, 2008 and 2009

to help, train and control operators on this sensitive activity.

It is important to note that PLL achieved successful 1000 unloading in year 2014 (26th

December 2014), at 120 % of initial capacity, without any accident on berth.

Since the signing of First TSA in October, 2003, PLL and Elengy began working together

regularly under an annual technical service agreement, focusing on two main areas:

to perform audits on safe and efficient operational management at Dahej

to provide training on fighting LNG fires for workers at Fos Tonkin in France, as PLL has adopted Elengy philosophy of first emergency response directly by shift operators in the terminal;

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The audit was conducted by Elengy experts in safety management systems as well as

operations.

PLL found these services invaluable. The relationship between the two companies was thus

characterized by a spirit of co-operation. PLL, being new to LNG terminal operation could

benefit, from Elengy advances in safety management.

Audit in safety management

GDF is also assisting PLL for safety audit, the scope of which had been:

To evaluate Safety Management System Six Key Activities are considered

Major Hazard Identification Personal Training Operational Control Management of Change Emergency Planning Performance Monitoring

This first audit has been performed by GDF personnel expert in Safety System.

Indeed, the Context was of severe requirements in Europe, with the proof of implementation

of a safety management system in oil and gas plants. For that, GDF selected a safety

referential made by DNV, Norway, and called ISRS (International safety rating system).

For that reason, GDF had already an experience in that domain.

A general management system has already been set up for recent ISO and OHSAS

certifications. As a consequence, it seems interesting to further progress in a critical domain

related to safety i.e. Major accidents prevention.

Every analysis was carried out with the management of the plant and with some

representative operators, temporarily involved in short working groups. A GDF referential,

based on best practices for these activities, has been used as a guidance document. Its

translation was implemented after the PLL decision to organize this safety management

statement on Dahej Terminal.

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The objective was the production of a report on the situation of the Dahej LNG Terminal for

each of these key activities. The report identified some comprehensive progress actions to

be submitted to the PLL management for implementation.

This audit benefited PLL in proposing some specific actions to strengthen the safety

management system that has already been set up in relation with the OHSAS certification.

Audit in operation and maintenance management

As per Technical Service Agreement extension between GDF and PLL, GDF will provide

assistance on operation and maintenance whose main objective is to follow up the

implementation of the Standard Operating Procedures (SOP) elaborated by PLL with the

assistance of GDF during the first year of operation, thus assisting PLL in monitoring the

progress of the plant management system.

In order to implement this task, four one week missions on site by GDF operation expert with

quarterly intervals have been scheduled during the year 2005/2006

Observations/recommendations have been compiled according to the following plan :

1. Fluid lockout management

2. Standard Operating Procedures application

3. Mockdrill scenario

4. Testing procedure for valves

5. Site visit report

Since then and until this day, an O&M audit has been performed every year by GDF to the

benefit of PLL. The major benefit to PLL team being an independent assessment of

preparedness of its O&M team and infusion of fresh ideas.

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Engineering reviews for the Kochi contracts

The construction of PLL’s second terminal at Kochi in the state of Kerala was very well organized, under three different EPC contracts:

first for the two tanks, the major items of investment,

second for the remainder of the LNG regasification process,

and the third for the marine structures,

Elengy assisted PLL by providing services to verify the interfaces specified in the contract document and ensuring that the contracts are properly organized and structured, and they were successfully and simultaneously executed, with practically no issue involving interface conflicts, even the management of lay down area was very smooth.

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Towards co-operation with new arrivals

Over 12 years, organizations see various people come and go, but the TSA has stayed the

same, both in terms of its cost structure (with a 10% share in its capital, Elengy considers

PLL a partner and provides services ) and its volume of work with some changes as required

with the elapse of time.

The continuity was made by direct actors, in charge of these activities. Direct relationship

was built, based on mutual trust. It helps a lot of course to transmit the spirit of the co-

operative TSA.

After the successful commissioning of Dahej, the first expatriate left Delhi and came back in

France, to manage the construction program of the new LNG terminal under EPC contract.

The lessons learnt in India on Dahej case were of course transmitted to its team.

This first representative has been replaced by a second one, based also in Delhi, who

played active part of the continuity of the TSA

Interesting case of reverse training

In April 2004, visit of the brand new LNG terminal of Dahej by the team in charge of the EPC

contract management for the new LNG terminal of Fos Cavaou (this terminal was ordered by

GDF in may 2004, and cooled down in 2009)

A second case of reverse training

The future shift managers of coming new LNG terminal Fos Cavaou went to visit a brand

new modern terminal in Dahej, in 2007

These people were recruited to start operation of New LNG terminal under construction.

They were trained of course in existing Elengy terminals. But the detailed visit of a brand

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new LNG terminal was extremely appreciated, in order to prepare the commissioning.

Especially the interaction with PLL O&M team provided fresh ideas to GDF team.

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Extension to new activities

Plant health monitoring review

Dahej is now more than 10 years old and PLL management rightly thought of a program to

organize monitoring of equipment health and measure to prevent ageing: first mission in

2014

Kochi terminal

After its successful cooling down in September 2013, PLL applied the same good recipe to

its terminal and asked Elengy to perform audit in safety management and operation

management. Of course, the reference is now Dahej management system, but independent

auditors are preferred

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A collaboration of equals

As the time is passing by both PLL and Elengy are facing similar difficulties such as low

send out from Montoir and Kochi gas terminals, though for different reasons, and they are

jointly working for practical solutions such as using terminals as multi-service depots

(imports, exports, cargo division, retail LNG) and managing the boil off (without flaring)

during low send out periods.

At Kochi the LNG terminal was ready for operation by Feb 2013, but the connected RLNG

evacuation pipeline and hence the consumers were still not ready. Even till now the major

segments of the pipeline are not ready for various socio-economic and political issues. The

consumers that are connected to the completed portion of pipeline can consume only about

2 to 5% of capacity of the terminal. For this purpose PLL had to think about various options

for handling BOG as the send out is much below the minimum required for re-condensation.

At Kochi PLL has installed minimum send out compressors (temporary API 11 P

compressors on hire and permanent API 618 compressor) for handling the BOG during low

send out. Other schemes are being developed in consultation with GDF. These include

installation of economizer exchanger between BOG compressor and re-condenser to reduce

the minimum turn down requirement.

Also PLL has utilized the previously kept option of reloading the LNG into small scale LNG

carriers for the purpose of using the terminal as storage option and at the time of writing this

paper two such re-loadings have been carried out.

Case of Montoir and Fos Cavaou

After a very busy period in 2008/2010 in Montoir (with a record on unloaded quantities), the

LNG transit goes East, toward Asia, and the unloaded quantities in Montoir decreased

seriously. At the same time, for commercial reason, some customers were interested to use

Montoir terminal as a hub for their precious product. In that view, after several changes in

the process lines, Montoir staff was able to perform successfully several reloading of

cargoes. Same opportunities occurred in Fos Cavaou terminal, and reloading flowrate has

been increased last year. And in addition, “trans-shipment” was performed in Montoir, a

transfer of LNG between 2 large tankers, from berth to berth.

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Fos Cavaou terminal, with reloading enhanced capacity

Montoir terminal, transhipment operation

Based on that experience, ELENGY was able to make a good practice and transfer it to PLL.

Nothing is really revolutionary, but the global picture gives a solid frame for safe operation on

the following technical aspects

Long period storage and consequence of LNG quality : simulation of ageing

Boil off gas management : pressure in tanks and in tanker

Flaring quantities : calculations and measurement, to be discussed/evaluated /agreed before commercial operation to avoid dispute

Control of operation in the terminal : control room procedures

ESD sequence dedicated to loading

Ship shore communication plan

Custody transfer

Zero send out compressors

In Montoir and in Kochi, initially no provisions were made for interruption of send out, in a

perspective of continuous operation. Facing a new situation without send out, the boil off of

the terminal cannot be recondense with LNG.

In both plant, a similar solution was adopted: short term hired high pressure BOG

compressors, connected temporarily to the natural gas grid are installed for temporary

service, in order to stop the flaring.

And in the meantime, study of a permanent solution, with permanent HP compressor for the

same service. Elengy and PLL were able to exchange in real time on solutions.

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Opportunities for co-operation in different matters and conclusion

There are future plans to construct new LNG terminals outside India, and the lessons Elengy

and PLL have learned from this TSA will be repeated as they co-operate on new industrial

schemes, such as “small-scale” terminals serviced by vessels.

Knowledge is the key to success, and here we have people who work together to turn that

key, opening new doors and new markets.

Co-operation is a fragile equilibrium, and partners need to fight everyday to keep the

balance. GDF was obviously attracted by a large Indian market, full of development

opportunities. GDF was proud to be selected by the First Indian LNG importer, PLL, and

made all its effort to succeed in the partnership.

The Technical service agreement was a way to:

Stay on the side of PLL, and not at the place of PLL

To give the credibility of their new activity in India to the lenders

To be consistent with the position of shareholder in PLL.

The multi cultural context of this TSA gives opportunity for men and women to increase their

understanding and their skills, in both companies.

Now the trust is built and PLL + Elengy are ready to go together elsewhere to provide

operating support, based on their experience.